Illinois Cooperative Brings Competition, Lower Costs for Small Businesses

Taking Advantage of Land Of Lincoln Health

Consumer Operated and Oriented Plans, or CO-OPs

for short, are a new health insurance option for small business owners. Created by the Affordable Care Act, CO-OPs are consumer-directed and required to engage members in plan oversight. Only insured members can vote for and run for a seat on the CO-OP’s Board of Directors.

What is a CO-OP?

The federal CO-OP program offers low-interest loans to eligible nonprofit groups to help set up and maintain these issuers. CO-OP loans are only made to private, nonprofit entities that demonstrate a high probability of financial viability. All CO-OPs receiving loans were selected by the Centers for Medicare & Medicaid Services on a competitive basis based on external independent review by a multi-disciplinary team. As CO-OPs meet or exceed developmental milestones, funds are allowed to be incrementally drawn down.

Taking Advantage of a CO-OP'portunity

The Illinois small business community capitalized on the CO-OP option. Small businesses in Illinois had been confronting high health insurance costs that threatened their ability to offer employee coverage. Illinois was previously dominated by one major health insurance carrier, who in 2014 wrote over 90% of the public health insurance marketplace policies in state. This market dominance gave small business owners few options in terms of obtaining and providing their employees with affordable health insurance. With CO-OPs offering the promise of increasing competition and lower rates, small businesses and individuals formed a CO-OP owned by its members and operated by its advocates.

Small Business Have More Choice

CO-OPs are following through on that promise. The Illinois CO-OP has enrolled over 50,000 businesses in 2015. During the second open enrollment period, one of every four new enrollees to the 2015 public marketplace is choosing a CO-OP. This additional competition is fantastic news for small business owners and their employees.

And High-Quality Plans

The Illinois CO-OP has been able to roll out innovative and transparent plans that connect consumers with provider choices they know and trust, because of the CO-OP's close relationship with the medical community. A consumer’s commitment, as an individual or employee, to choose the provider on the front end and at the time of selecting insurance coverage motivates the provider to build a strong relationship with that consumer. As a consumer-focused company, The CO-OP's small business insurance offerings are also designed by individuals who are attuned to the unique needs of this community.

The Bottom Line

The majority of small business owners value and care about their employees. Moreover, healthy employees with access to quality medical care are happier, more motivated and productive. Stabilizing health insurance premiums for small businesses while at the same time enabling them to procure quality coverage for their employees is a true game-changer. Small businesses drive our economy. Providing them access to affordable health insurance will benefit not only the small business community, but the entire Illinois economy.


Elliot Richardson
Founder and CEO
Small Business Advocacy Council